SHALL I BUY A SHORT SALE?
That answer can be YES or NO. It depends on many things. I will try to explain
what a short sale is,
what you can expect and
what can happen if you give an offer on a short sale.
A short sale is when a homeowner of some reason wants/needs to sell his property and he owes more in the property than its market value.
The homeowner/listing agent will then ask the bank/banks to forgive this difference between the owed money and the selling price. The bank needs proof that there is a true hardship, it means that the homeowner might have lost his job, has a job transfer, got divorced or got ill with high medical costs or what else that has happened. It is not sure that the bank will forgive all that money but can demand the seller to pay back some of the money (promissory note).
To start a Short Sale procedure, the listing agent will have to have an OFFER from a buyer. As a short sale is a long, insecure process many buyers do not want to give an offer on such a property. Therefore the listing agent will need to put an attractive asking price on the property to get interested buyers.
The listing agent can put whatever price he/she wants on the property, of course with sellers acceptance. The listing agent needs an offer as soon as possible to start the whole process. It is NOT SURE that the bank will ever accept that price as it is THE BANK THAT DECIDES THE PRICE IN THE END.
The banks are interested in getting as much money as possible so they have often several appraisals on the property before they accept an offer from a buyer. A cash offer is not more attractive for them as a buyer with a normal loan, remember they WANT MONEY.
The homeowner also wants the highest price possible as the less difference between owed money and selling price means faster response and less risk for the homeowner to have to pay money back to the bank.
So when you, BUYER, sees a house for sale as a Short Sale you will have to know that
1) The price is not sure (mostly the price is too low for market value)
2) The bank is not willing just to sell the house for much lower price than value
3) The homeowner will have to accept an offer, can come with a counteroffer
4) Then the bank will have to accept the offer, that the seller accepted, will mostly
come with a counteroffer
5) The whole procedure will take time, expect min. 2 months to easily 4-5 months
before the buyer, (if the seller accepted his offer), will be accepted by the bank
or what kind of counteroffer the bank will give
6) Some problems can suddenly show up as:
leans on the property somebody has to pay for
unpaid HOA fees that have to be paid (who will pay for that?)
homeowner will declare bankruptcy and the sale will stop
7) Nobody is willing to pay for repairs in the house. House is sold AS-IS.
8) Nobody will pay for the Home Warranty (sometimes the banks accept to pay)
9) Sometimes the bank will pay up to 3% of buyer's closing costs
10)Sometimes the buyer will have to pay for the termite inspection and the repairs.
11)Sometimes the listing agent will open escrow with the accepted offer by the
seller even the bank has not agreed to sell the property yet.
12)Sometimes the buyer will need to give some extra private information as birth date
13)You will need to be patient. This here takes time but you can get a good price
house. We will still use the same purchase contract and the time frame and rights
are the same.
So the question was: "Shall I buy a Short Sale?" And the answer will be,
"Yes" , if you can wait these months and are aware of these risks that might be. To lower the risks, be sure you know what the comps (comparatives) are for your property and compare them with your offer. If it is a property with a HOA find out through your agent if the HOA is paid up to date. You can still look for other houses while you are waiting.
"No" if you hate to wait and is impatient or you have to buy right now. Look for a REO (Bank owned house) or a normal sale. You will get an answer within some days. Normally a REO will get a lot of offers. Expect to go up in price. Listing price for normal sales are often higher as you will get all kind of disclosures and knowledge about the property and safer as you can always come back to seller if something was not disclosed.
Short Sales are normally nice well-kept houses as people still live in the houses while REOs are often a kind of destroyed houses as they have not been taken care of for a long time and might have been empty for half a year or more. Recently many banks have painted, put new carpet and made some repairs in these houses before they come on the market.
Hopefully, this article can help to understand a short sale. Be free to contact me if you have more questions. I have tried to explain it as easy as possible.
Marianne Leopold
7/25/2010
Sunday, July 25, 2010
EAT, PRAY, LOVE
Just finished the book Eat, Pray, Love by Elizabeth Gilbert. I can't wait to see the film. It should come up in 2 weeks. "Pretty woman", Julia Roberts, is the perfect one to play that role. I cannot imagine a better one.
After this film, all us women, we will love to do the same journey as she did, I guess. At least I want to go to India and Bali. (I have been around in Italy and it is a great country, too.)
Read that book and see the film and let me know!
Marianne
After this film, all us women, we will love to do the same journey as she did, I guess. At least I want to go to India and Bali. (I have been around in Italy and it is a great country, too.)
Read that book and see the film and let me know!
Marianne
Saturday, July 24, 2010
Can I get a LOAN MODIFICATION?
Home owners may qualify for a modification if the answer is "YES" to these five basic questions:
1) Is the home the primary residence?
2) Is the amount owe less than or equal to $729,750?
3) Is the homeowner having trouble paying the mortgage? In other words,
has the mortgage mayment increased recently,
has income dropped
are there other hardships, such as medical bills, that increased a
a hardship?
4) Was the current mortgage obtained prior to Jan. 1, 2009?
5) Is the payment on the first mortgage, including principal, interest, taxes,
insurance and homeowner's association dues if applicable more than 31 percent of
current gross income?
Information on how to get started and what assistance is currently available to refinance a loan or obtain a loan modification can be found online at
www.MakingHomeAffordable.gov
For example, the administration's website makes it easy to determine if a loan is owned by Fannie Mae or Freddie Mac, a key criteria of eligibility for refinancing assistance.
Mortgage servicers by Aug. 1 will offer borrowers a forbearance period to temporarily reduce to 31 percent of gross monthly income or suspend monthly mortgage payments while homeowners seek a job. Details of this new program are also available at the above mentioned website under the section titled "Help for the Unemployed".
Today's lower interest rates offer a unique chance to refiance loans, perhaps bringing a loan to a more affordable level, thus improving its long-term affordability and sustainability. To qualify for refinancing, the amount owed cannot exceed 125 percent of a property's current market value. Income must be fully documented, presenting pay stubs and tax returns, and the total loan amount cannot exceed $729,750.
The website mentioned leads eligible applicants through the procedure and provides required forms that must be completed to get started. If a servicer provides a trial payment period, the applicant must make all payments. If he fails to make a payment he is out.
Most importantly, if a final modification has not been approved, owners should continue to make monthly payments even if the trial period has ended.
Applicants must be truthful when asked to state income and debt. Don't hide anything. They will find out.
Applicant's who have excessive debt - owe more than 55 percent of gross income - are required to go counseling to get expenses under control.
If successful, a loan modification can bring the interest rate to as low as 2 percent or could possibly extend the term of the loan to 40 years, with the goal being to bring total payments lower than 31 percent of gross income. To achieve that, a portion of the principal can be deferred, interest free, until the loan is paid off.
Principal forgiveness is allowed, but not required. No more than 31 percent of market value can be deferred to make the loan more affordable to the borrower.
Be beware of scams that promise owners that they can obtain a loan modification from any lender. The Making Home Affordable program and approved debt counselors are free of charge to taxpayers. Payment of a fee does not guarantee success. Walk away if any make promises and want to collect a fee.
(rewritten article from Realtor Report, July 2010)
1) Is the home the primary residence?
2) Is the amount owe less than or equal to $729,750?
3) Is the homeowner having trouble paying the mortgage? In other words,
has the mortgage mayment increased recently,
has income dropped
are there other hardships, such as medical bills, that increased a
a hardship?
4) Was the current mortgage obtained prior to Jan. 1, 2009?
5) Is the payment on the first mortgage, including principal, interest, taxes,
insurance and homeowner's association dues if applicable more than 31 percent of
current gross income?
Information on how to get started and what assistance is currently available to refinance a loan or obtain a loan modification can be found online at
www.MakingHomeAffordable.gov
For example, the administration's website makes it easy to determine if a loan is owned by Fannie Mae or Freddie Mac, a key criteria of eligibility for refinancing assistance.
Mortgage servicers by Aug. 1 will offer borrowers a forbearance period to temporarily reduce to 31 percent of gross monthly income or suspend monthly mortgage payments while homeowners seek a job. Details of this new program are also available at the above mentioned website under the section titled "Help for the Unemployed".
Today's lower interest rates offer a unique chance to refiance loans, perhaps bringing a loan to a more affordable level, thus improving its long-term affordability and sustainability. To qualify for refinancing, the amount owed cannot exceed 125 percent of a property's current market value. Income must be fully documented, presenting pay stubs and tax returns, and the total loan amount cannot exceed $729,750.
The website mentioned leads eligible applicants through the procedure and provides required forms that must be completed to get started. If a servicer provides a trial payment period, the applicant must make all payments. If he fails to make a payment he is out.
Most importantly, if a final modification has not been approved, owners should continue to make monthly payments even if the trial period has ended.
Applicants must be truthful when asked to state income and debt. Don't hide anything. They will find out.
Applicant's who have excessive debt - owe more than 55 percent of gross income - are required to go counseling to get expenses under control.
If successful, a loan modification can bring the interest rate to as low as 2 percent or could possibly extend the term of the loan to 40 years, with the goal being to bring total payments lower than 31 percent of gross income. To achieve that, a portion of the principal can be deferred, interest free, until the loan is paid off.
Principal forgiveness is allowed, but not required. No more than 31 percent of market value can be deferred to make the loan more affordable to the borrower.
Be beware of scams that promise owners that they can obtain a loan modification from any lender. The Making Home Affordable program and approved debt counselors are free of charge to taxpayers. Payment of a fee does not guarantee success. Walk away if any make promises and want to collect a fee.
(rewritten article from Realtor Report, July 2010)
Wednesday, July 21, 2010
5 REAL ESTATE SCAMS YOU NEED TO KNOW ABOUT
5 Real Estate Scams You Need to Know About
Don't be duped by mortgage fraud. Here are a few common scams and the red flags you should look for in a transaction.
By Melissa Dittmann Tracey | August 2010
Mortgage fraud is pervasive: An estimated $4 billion to $6 billion in annual losses result from mortgage fraud, according to FBI reports. “An entire community can be damaged by mortgage fraud,” says Rachel Dollar, a lawyer from Santa Rosa, Calif., and editor of the Mortgage Fraud Blog. Mortgage fraud can lead to a spike in foreclosures, home values plummeting, and lenders raising their rates and fees to recover losses.
The crimes are often complex, involving several parties and occurring over multiple transactions. To protect you and your clients, educate yourself about mortgage fraud and be on guard for any warning signs in a transaction. You can start by reviewing these five scams, and then test your knowledge by taking our Mortgage Fraud Quiz.
1. The Foreclosure Rescue Scheme
The Scam: “Rescuers” promise cash-strapped home owners that they can save their home from foreclosure. The rescue, which involves paying upfront fees, can take multiple forms, such as the perpetrator obtaining a new loan on behalf of the owner or by having the owner sign over the home’s deed and then rent the home until they can repurchase it. Eventually, the home owner loses the home, either to foreclosure or the fictitious rescue company.
Red Flags: With foreclosure rescue programs, borrowers are often advised to sign over the title of their house to a third party, become renters of their home, not contact their lender, or send mortgage payments to a third party, according to Fannie Mae, which provides fact sheets on mortgage fraud.
2. Loan Documentation Fraud
The Scam: This fraud involves numerous schemes in which a borrower provides inaccurate financial information — such as about their income, assets, and liabilities — or employment status in order to qualify for a loan with lower rates and more favorable terms. Occupancy fraud is one growing area: Borrowers say they plan to live in the property when they actually intend to rent it.
Red Flags: Documentation may raise suspicion if the employer’s address is shown as a post office box, accumulation of assets compared to the person’s income appears too high or low, the new house is too small to accommodate occupants, the person has no credit history, or the application is unsigned or undated, according to Fannie Mae.
3. Appraisal Fraud
The Scam: A faulty appraisal — saying a property is worth more than what it really is — is connected to many types of mortgage fraud. It entails manipulating or overstating comparables, market values, or property characteristics in order to obtain a higher appraisal. The higher property appraisal, which generates false equity, is done by falsifying an appraisal document or using an appraiser accomplice to obtain the higher value.
Red Flags: Be skeptical of appraisals that are dated prior to the sales contract, list comparable sales that do not contain similarities to the property or are outside the neighborhood, the owner is not the seller listed on the contract or the title, or a third party participating in the transaction orders the appraisal, Freddie Mac warns.
4. Illegal Property Flipping
The Scam: This entails purchasing properties and reselling them at inflated prices. These scams usually involve faulty appraisals and inaccurate loan documents. The property is then refinanced or resold immediately after purchase for an inflated value. The home is purchased at a higher price, often by straw buyers working with the “flipper,” and eventually falls into foreclosure.
Red Flags: Some key things to look for are rapid refinancing of a property; the seller recently having acquired the title or acquiring the title concurrent with the transaction; an appraisal that comes in too high; a property that was recently in foreclosure being purchased at a much lower price than its sales price; or the owner listed on the appraisal and title not matching the seller on the sales contract, according to Fannie Mae.
5. Short Sales Schemes
The Scam: Borrowers owe more than the current value of their home so they fake financial hardship and no longer make their mortgage payments. An accomplice of the borrower then submits a low offer to purchase the property in a short sale agreement. The lender agrees to the short sale, unaware that it was premeditated. The property, after being purchased at the reduced price, is then often resold at the home’s actual value for profit.
Red Flags: The borrower suddenly defaults on the mortgage with no workout discussions with the lender, an immediate offer is made to a lender at a short sale price, the short sale offer is less than current market value, or a cash back is offered at closing to the delinquent borrower (disguised as “repairs” or other payouts, for example) and is not disclosed to the lender, according to Fannie Mae.
Don't be duped by mortgage fraud. Here are a few common scams and the red flags you should look for in a transaction.
By Melissa Dittmann Tracey | August 2010
Mortgage fraud is pervasive: An estimated $4 billion to $6 billion in annual losses result from mortgage fraud, according to FBI reports. “An entire community can be damaged by mortgage fraud,” says Rachel Dollar, a lawyer from Santa Rosa, Calif., and editor of the Mortgage Fraud Blog. Mortgage fraud can lead to a spike in foreclosures, home values plummeting, and lenders raising their rates and fees to recover losses.
The crimes are often complex, involving several parties and occurring over multiple transactions. To protect you and your clients, educate yourself about mortgage fraud and be on guard for any warning signs in a transaction. You can start by reviewing these five scams, and then test your knowledge by taking our Mortgage Fraud Quiz.
1. The Foreclosure Rescue Scheme
The Scam: “Rescuers” promise cash-strapped home owners that they can save their home from foreclosure. The rescue, which involves paying upfront fees, can take multiple forms, such as the perpetrator obtaining a new loan on behalf of the owner or by having the owner sign over the home’s deed and then rent the home until they can repurchase it. Eventually, the home owner loses the home, either to foreclosure or the fictitious rescue company.
Red Flags: With foreclosure rescue programs, borrowers are often advised to sign over the title of their house to a third party, become renters of their home, not contact their lender, or send mortgage payments to a third party, according to Fannie Mae, which provides fact sheets on mortgage fraud.
2. Loan Documentation Fraud
The Scam: This fraud involves numerous schemes in which a borrower provides inaccurate financial information — such as about their income, assets, and liabilities — or employment status in order to qualify for a loan with lower rates and more favorable terms. Occupancy fraud is one growing area: Borrowers say they plan to live in the property when they actually intend to rent it.
Red Flags: Documentation may raise suspicion if the employer’s address is shown as a post office box, accumulation of assets compared to the person’s income appears too high or low, the new house is too small to accommodate occupants, the person has no credit history, or the application is unsigned or undated, according to Fannie Mae.
3. Appraisal Fraud
The Scam: A faulty appraisal — saying a property is worth more than what it really is — is connected to many types of mortgage fraud. It entails manipulating or overstating comparables, market values, or property characteristics in order to obtain a higher appraisal. The higher property appraisal, which generates false equity, is done by falsifying an appraisal document or using an appraiser accomplice to obtain the higher value.
Red Flags: Be skeptical of appraisals that are dated prior to the sales contract, list comparable sales that do not contain similarities to the property or are outside the neighborhood, the owner is not the seller listed on the contract or the title, or a third party participating in the transaction orders the appraisal, Freddie Mac warns.
4. Illegal Property Flipping
The Scam: This entails purchasing properties and reselling them at inflated prices. These scams usually involve faulty appraisals and inaccurate loan documents. The property is then refinanced or resold immediately after purchase for an inflated value. The home is purchased at a higher price, often by straw buyers working with the “flipper,” and eventually falls into foreclosure.
Red Flags: Some key things to look for are rapid refinancing of a property; the seller recently having acquired the title or acquiring the title concurrent with the transaction; an appraisal that comes in too high; a property that was recently in foreclosure being purchased at a much lower price than its sales price; or the owner listed on the appraisal and title not matching the seller on the sales contract, according to Fannie Mae.
5. Short Sales Schemes
The Scam: Borrowers owe more than the current value of their home so they fake financial hardship and no longer make their mortgage payments. An accomplice of the borrower then submits a low offer to purchase the property in a short sale agreement. The lender agrees to the short sale, unaware that it was premeditated. The property, after being purchased at the reduced price, is then often resold at the home’s actual value for profit.
Red Flags: The borrower suddenly defaults on the mortgage with no workout discussions with the lender, an immediate offer is made to a lender at a short sale price, the short sale offer is less than current market value, or a cash back is offered at closing to the delinquent borrower (disguised as “repairs” or other payouts, for example) and is not disclosed to the lender, according to Fannie Mae.
Sunday, July 18, 2010
Stage your home before selling!
STAGE RIGHT
TAKE A BUYER’S POINT OF VIEW
Try to look at each home as a buyer would. That means looking at the room from the doorway and using that as a frame to show off the most appealing parts of the room. Many times, prospective buyers won’t venture beyond the doorway, so it’s important to entice them to enter the room. Take steps to make the room look as clean, neat and spacious as possible. Remove excess furniture and keep floors free of any stacks of clutter.
DECLUTTER
It sounds obvious but decluttering is the single biggest aspect of staging – and one that is free of charge. Every surface, including countertops in kitchens and bathrooms, should be as clear as possible. Stow toiletries under the sink, and pack up personal photographs so buyers don’t get distracted by looking at your pictures.
GET RID OF THE UGLY
If furniture, fixture and appliance colors or window treatments are outdated, threadbare or otherwise unappealing, consider replacing them with low-cost temporary fixes.
CLEAN
The home has to be super clean. “The Complete Idiot’s Guide to Staging Your Home to Sell” says that deep-cleaning carpets, upholstery and window treatments are important to both improve the home’s appearance and remove lingering odors.
LIGHTEN UP
Each room should be light and bright. Clean windows and tie curtains back to let the light shine into the room. Lighten dark colors on the walls with inexpensive paint in neutral, light colors like white, off-white or light taupe. Paint can also be used to cover worn or outdated cabinets. And some inexpensive new drawer pulls and cabinet handles from your local hardware or home supply store for a fresh new look for less than $30.
GO SHOPPING IN THE HOME
Sometimes it is a good idea to move items from one room to another. One room may be stuffed with furniture, while another room could benefit from a great piece that can be a focal point.
ACCESSORIZE
All-neutral rooms can be a bit boring, so have pillows and small accents like candles to cheer up the room. Green is a favorite, as it coordinates with most other colors without clashing.
LOOK FOR CURB APPEAL
The outside of the home is just as important as the inside. Clean up the yard. Trim hedges and weed flowerbeds. Remove dead plants. Repair cracks in cement or asphalt, and power wash driveways and sidewalks.
Most of these activities take some effort but most require very little money and often make a big difference when it comes to the length of time the home sits on the market. ML
TAKE A BUYER’S POINT OF VIEW
Try to look at each home as a buyer would. That means looking at the room from the doorway and using that as a frame to show off the most appealing parts of the room. Many times, prospective buyers won’t venture beyond the doorway, so it’s important to entice them to enter the room. Take steps to make the room look as clean, neat and spacious as possible. Remove excess furniture and keep floors free of any stacks of clutter.
DECLUTTER
It sounds obvious but decluttering is the single biggest aspect of staging – and one that is free of charge. Every surface, including countertops in kitchens and bathrooms, should be as clear as possible. Stow toiletries under the sink, and pack up personal photographs so buyers don’t get distracted by looking at your pictures.
GET RID OF THE UGLY
If furniture, fixture and appliance colors or window treatments are outdated, threadbare or otherwise unappealing, consider replacing them with low-cost temporary fixes.
CLEAN
The home has to be super clean. “The Complete Idiot’s Guide to Staging Your Home to Sell” says that deep-cleaning carpets, upholstery and window treatments are important to both improve the home’s appearance and remove lingering odors.
LIGHTEN UP
Each room should be light and bright. Clean windows and tie curtains back to let the light shine into the room. Lighten dark colors on the walls with inexpensive paint in neutral, light colors like white, off-white or light taupe. Paint can also be used to cover worn or outdated cabinets. And some inexpensive new drawer pulls and cabinet handles from your local hardware or home supply store for a fresh new look for less than $30.
GO SHOPPING IN THE HOME
Sometimes it is a good idea to move items from one room to another. One room may be stuffed with furniture, while another room could benefit from a great piece that can be a focal point.
ACCESSORIZE
All-neutral rooms can be a bit boring, so have pillows and small accents like candles to cheer up the room. Green is a favorite, as it coordinates with most other colors without clashing.
LOOK FOR CURB APPEAL
The outside of the home is just as important as the inside. Clean up the yard. Trim hedges and weed flowerbeds. Remove dead plants. Repair cracks in cement or asphalt, and power wash driveways and sidewalks.
Most of these activities take some effort but most require very little money and often make a big difference when it comes to the length of time the home sits on the market. ML
Saturday, July 17, 2010
12 TIPS to make your move simple and avoid the hassle
Here are 12 tips to make your move simple and avoid the hassle.
Choose a type of move: You have three basic choices: do-it-yourself, full service and a relatively new hybrid of the two. Going it alone is the cheapest alternative, costing the rental price of a truck, gasoline, packing materials and, perhaps, pizza and beer for friends you rope into helping. With full-service moves, moving within a state is charged by the hour, while moving across state lines is charged by weight and mileage.
With a hybrid move, a mover will drop off a large container at your home for you to pack. The mover will then load the container onto a truck, drive the belongings to your new location and drop off the container for you to unload. Because you’re doing the manual labor of packing and unpacking, it’s far less costly than a full-service move.
Hire a quality mover: If you hire help, get at least three price quotes and do your homework before selecting a mover. Seek recommendations by talking with family and friends, even your Facebook circle. Investigate a company’s reputation with the Better Business Bureau (bbb.org), Yelp.com and possibly the paid-membership site Angie’s List (angieslist.com). Check a company’s complaint history at the federal government site, ProtectYourMove.gov.
“People think a good reputation equals expensive, but that’s not true,” said Laura McHolm, co-founder of NorthStar Moving in Los Angeles. “You don’t get a good reputation by overcharging people.”
Look for two things when hiring a moving company: A full-service mover should visit your home in person, not give a quote over the phone or online, and should provide a written estimate, experts say.
Declutter: No matter what type of move you’re making, taking less stuff is cheaper and less hassle. Set up a staging area, perhaps in a garage, with various piles, such as throw out, recycle, donate and sell.
For many items, use the rule of thumb, ‘If you haven’t used it in a year, you probably don’t need it.’
Be flexible: Like airline fares, moving rates depend on when you book. The busiest time for movers, and thus the most expensive time for consumers, is summer weekends near the 15th and 30th of the month.
If you have time flexibility, ask what rates would be for different days or seasons. If you have extreme flexibility, ask about moving standby: waiting until the mover has extra space and needs to fill a truck.
Save on boxes: Buying new boxes from a moving company is the most expensive choice. To save some money on packing materials, ask if you can buy used boxes from your moving company.
Cheaper yet is finding free boxes, ideally from somebody who just moved. Ask your real estate agent to connect you with other clients who recently moved or look on Craigslist.org. Specialty boxes, such as wardrobe boxes, might be cheaper to purchase at a do-it-yourself moving store, such as U-Haul, than from your mover.
Save on packing materials: If you’re packing your belongings yourself, fill suitcases, laundry baskets and plastic containers with unbreakable items. Use pillows, scarves and towels to wrap fragile belongings.
Mail books: If you have a large collection of books, pack them yourself and ship them at the postal media mail rate as it might be cheaper than paying a mover—a 70-pound box would cost less than $30.
Consider consolidation: For long-distance moves, ask about consolidating your stuff on a truck with other people’s as most homeowners can’t fill a full-size moving van. You might have to be flexible on delivery dates and times, but consolidation can be cheaper.
Insure it: Check your homeowner’s or renter’s insurance policy to determine whether it provides coverage for your belongings while in transit. If not, you’ll probably want more than the basic free valuation coverage a full-service mover provides. The standard valuation is 60 cents per pound per item. That means breaking a 10-pound, $1,000 stereo system would net you $6. You’ll want full replacement-value insurance, which reimburses you what it will cost to replace broken items. But don’t necessarily buy that insurance from the moving company. Moving insurance is likely cheaper from a third party, but be aware that you probably cannot get insurance on boxes you packed yourself.
Be prepared: Plot out where furniture and boxes will go before moving day arrives. The less time movers spend rearranging, the less expensive it will be.
In urban areas, reserve a space or two in front of your new home for the moving truck by parking your own vehicle there ahead of time. If the movers have to park too far away to unload, you could incur a ‘long carry’ surcharge.
Stake your claim: If you’re moving for a job, negotiate the best relocation package you can. Unreimbursed expenses might be tax-deductible. For details, see Publication 521 Moving Expenses at IRS.gov.
Tip: Tipping each mover $3-$5 per hour is customary, said Stephen Coady, marketing manager for Gentle Giant Moving Co. in Somerville, Mass.
Choose a type of move: You have three basic choices: do-it-yourself, full service and a relatively new hybrid of the two. Going it alone is the cheapest alternative, costing the rental price of a truck, gasoline, packing materials and, perhaps, pizza and beer for friends you rope into helping. With full-service moves, moving within a state is charged by the hour, while moving across state lines is charged by weight and mileage.
With a hybrid move, a mover will drop off a large container at your home for you to pack. The mover will then load the container onto a truck, drive the belongings to your new location and drop off the container for you to unload. Because you’re doing the manual labor of packing and unpacking, it’s far less costly than a full-service move.
Hire a quality mover: If you hire help, get at least three price quotes and do your homework before selecting a mover. Seek recommendations by talking with family and friends, even your Facebook circle. Investigate a company’s reputation with the Better Business Bureau (bbb.org), Yelp.com and possibly the paid-membership site Angie’s List (angieslist.com). Check a company’s complaint history at the federal government site, ProtectYourMove.gov.
“People think a good reputation equals expensive, but that’s not true,” said Laura McHolm, co-founder of NorthStar Moving in Los Angeles. “You don’t get a good reputation by overcharging people.”
Look for two things when hiring a moving company: A full-service mover should visit your home in person, not give a quote over the phone or online, and should provide a written estimate, experts say.
Declutter: No matter what type of move you’re making, taking less stuff is cheaper and less hassle. Set up a staging area, perhaps in a garage, with various piles, such as throw out, recycle, donate and sell.
For many items, use the rule of thumb, ‘If you haven’t used it in a year, you probably don’t need it.’
Be flexible: Like airline fares, moving rates depend on when you book. The busiest time for movers, and thus the most expensive time for consumers, is summer weekends near the 15th and 30th of the month.
If you have time flexibility, ask what rates would be for different days or seasons. If you have extreme flexibility, ask about moving standby: waiting until the mover has extra space and needs to fill a truck.
Save on boxes: Buying new boxes from a moving company is the most expensive choice. To save some money on packing materials, ask if you can buy used boxes from your moving company.
Cheaper yet is finding free boxes, ideally from somebody who just moved. Ask your real estate agent to connect you with other clients who recently moved or look on Craigslist.org. Specialty boxes, such as wardrobe boxes, might be cheaper to purchase at a do-it-yourself moving store, such as U-Haul, than from your mover.
Save on packing materials: If you’re packing your belongings yourself, fill suitcases, laundry baskets and plastic containers with unbreakable items. Use pillows, scarves and towels to wrap fragile belongings.
Mail books: If you have a large collection of books, pack them yourself and ship them at the postal media mail rate as it might be cheaper than paying a mover—a 70-pound box would cost less than $30.
Consider consolidation: For long-distance moves, ask about consolidating your stuff on a truck with other people’s as most homeowners can’t fill a full-size moving van. You might have to be flexible on delivery dates and times, but consolidation can be cheaper.
Insure it: Check your homeowner’s or renter’s insurance policy to determine whether it provides coverage for your belongings while in transit. If not, you’ll probably want more than the basic free valuation coverage a full-service mover provides. The standard valuation is 60 cents per pound per item. That means breaking a 10-pound, $1,000 stereo system would net you $6. You’ll want full replacement-value insurance, which reimburses you what it will cost to replace broken items. But don’t necessarily buy that insurance from the moving company. Moving insurance is likely cheaper from a third party, but be aware that you probably cannot get insurance on boxes you packed yourself.
Be prepared: Plot out where furniture and boxes will go before moving day arrives. The less time movers spend rearranging, the less expensive it will be.
In urban areas, reserve a space or two in front of your new home for the moving truck by parking your own vehicle there ahead of time. If the movers have to park too far away to unload, you could incur a ‘long carry’ surcharge.
Stake your claim: If you’re moving for a job, negotiate the best relocation package you can. Unreimbursed expenses might be tax-deductible. For details, see Publication 521 Moving Expenses at IRS.gov.
Tip: Tipping each mover $3-$5 per hour is customary, said Stephen Coady, marketing manager for Gentle Giant Moving Co. in Somerville, Mass.
Friday, July 9, 2010
RETIREMENT LOCATIONS - most affordable
Most Affordable Popular Retirement Locations
The real estate downturn has turned some very popular retirement destinations into bargains.
To determine where the prices are most attractive, U.S. News & World Report examined price-to-income data for 384 metropolitan statistical areas. This expresses the relationship between owner income and home values.
Here are 10 retirement havens where homes are most affordable by this measure:
1. Bend, Ore.
2. Napa, Calif.
3. Fort Meyers, Fla.
4. Fayetteville, Ark.
5. Las Vegas
6. Sante Fe, N.M.
7. Punta Gorda, Fla.
8. Phoenix
9. Santa Cruz, Calif.
10. Burlington, Vt.
Source: U.S. News & World Report, Luke Mullins (07/08/2010)
The real estate downturn has turned some very popular retirement destinations into bargains.
To determine where the prices are most attractive, U.S. News & World Report examined price-to-income data for 384 metropolitan statistical areas. This expresses the relationship between owner income and home values.
Here are 10 retirement havens where homes are most affordable by this measure:
1. Bend, Ore.
2. Napa, Calif.
3. Fort Meyers, Fla.
4. Fayetteville, Ark.
5. Las Vegas
6. Sante Fe, N.M.
7. Punta Gorda, Fla.
8. Phoenix
9. Santa Cruz, Calif.
10. Burlington, Vt.
Source: U.S. News & World Report, Luke Mullins (07/08/2010)
Monday, July 5, 2010
Mortgage rates sink even loweer
DECLINING HOME EQUITY, TIGHTER STANDARDS ARE STOPPING BORROWERS.
Mortgage rates have sunk to the lowest level in mofre than five decades, but consumers aren't rushing to refinance their loans or buy homes.
Mortgage company Freddie Mac said the average rate for 30-year fixed lons sank to 4.58 percent this week.
Rates have fallen over the past two months. Investors wary of the European debt crisis and the stock market have shifted money into the safety of Treasury bonds, driving down yields.
Refinancing is generally considered worthwhile for homeowners who can shave at least three-quarters of a percentage point off the rates they pay now and plan to stay in their homes for a long time.
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Mortgage rates have sunk to the lowest level in mofre than five decades, but consumers aren't rushing to refinance their loans or buy homes.
Mortgage company Freddie Mac said the average rate for 30-year fixed lons sank to 4.58 percent this week.
Rates have fallen over the past two months. Investors wary of the European debt crisis and the stock market have shifted money into the safety of Treasury bonds, driving down yields.
Refinancing is generally considered worthwhile for homeowners who can shave at least three-quarters of a percentage point off the rates they pay now and plan to stay in their homes for a long time.
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